University of Bristol (Alder King) ISSUES 1 AND 2 · 1.1 Alder King Planning Consultants have been...
Transcript of University of Bristol (Alder King) ISSUES 1 AND 2 · 1.1 Alder King Planning Consultants have been...
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University of Bristol (Alder King) ISSUES 1 AND 2
Prepared by: Date of Issue:Author MH Approved
By NT
ALDER KING November 2011Planning Consultants Pembroke House Our Ref: MH/5817415 Pembroke Road, BS8 3BA
CONTENTS 1 INTRODUCTION..................................................................................................................... 3 2 SWRSS HOUSING TARGET ................................................................................................. 5 3 LOCATION OF DEVELOPMENT ........................................................................................... 8 4 QUANTUM OF DEVELOPMENT ......................................................................................... 10 5 ROBUSTNESS OF SWRSS EVIDENCE BASE ................................................................... 13 6 CROSS BOUNDARY IMPLICATIONS FOR REDUCED HOUSING PROVISION ............... 15 7 CONCLUSION ...................................................................................................................... 17 Appendices Appendix 1 – ONS Projections Appendix 2 – Future Housing Requirements in North Somerset
1 INTRODUCTION
1.1 Alder King Planning Consultants have been instructed by the University of
Bristol (‘the University’) to represent their land interests at the forthcoming
Examination in Public into North Somerset Council’s (‘the Council’)
emerging Core Strategy.
1.2 The University’s land interest consists of a 70ha parcel of land located
directly adjacent to the town of Long Ashton. Whilst Long Ashton is located
within the administrative boundary of North Somerset, the settlement
maintains a close functional relationship with the City of Bristol due to its
close proximity.
1.3 Following the publication of the draft South West Regional Spatial Strategy
(SWRSS) and the identification of the University’s land within an Area of
Search, a planning application was submitted to the Council proposing a
residential led, mixed use scheme consisting of 1,000 houses 12,000m² of
B1 employment land, safeguarded land for a new primary school and rail
halt, recreational playing fields, community uses and associated
infrastructure. The planning application is currently pending consideration
by the Council, and it is expected that a decision will be made following the
adoption of the Core Strategy.
1.4 The planning application was predicated on planning policy contained
within the emerging SWRSS, in particular the need for 26,750 new homes
to be brought forward during the plan period, and delivered in part by an
urban extension at South West Bristol of 10,500 new homes (9,000 of
which were to be delivered on Green Belt land within North Somerset).
1.5 Following the Government’s announced abolition of regional strategies,
and the subsequent ability of local authorities to establish locally derived
housing targets, the Council has identified a new housing target of 14,000
houses for the plan period. The Council suggests that this housing target is
to facilitate an employment led approach for the Core Strategy, which
seeks to deliver 10,100 new jobs during the plan period. As will be
demonstrated in this position statement, the Council’s housing target is
woefully inadequate and will result in economic paralysis during the plan
period with severe sustainability implications.
1.6 Our headline arguments are summarised below:
• Both the extant RSS (RPG10) and the SWRSS recognise the inherent need for residential development to accommodate the growth requirements of the Housing Market Area (HMA). Instead, North Somerset’s current housing target is an attempt to satisfy the growth requirements of North Somerset only, under the guise of Localism (and fails to even do this). Both the sub-regional housing market and the sub-regional functional economy operate at a West of England level and are not contained within the boundary of North Somerset.
• The Core Strategy housing evidence base is allegedly structured solely against an employment led approach to secure the delivery of approximately 10,100 jobs during the plan period. The relationship between jobs and housing delivery is established using a home to job ratio of 1.33. Adhering to this logic, zero job creation would result in zero housing need. Such an approach is flawed. It implies that there is no housing requirement from population growth, in-migration or changes in household structures.
• Alternative modelling undertaken by Hardisty Jones Associates (HJA) suggests that there is a latent demand for at least 14,100 residential units even before employment driven demand is considered. If the Council were to satisfy the Core Strategy employment targets or those set by the West of England Local Enterprise Partnership, the housing requirement would total between 22,100 units and 23,200 units (minimum).
• The HJA growth scenarios are aligned to the 2008 population projections which underpin the SWRSS housing target of 26,750 for North Somerset. The Inspector for the City of Bristol’s EiP placed weight on the 2003 projections and adjusted Bristol City’s housing target in line with the SWRSS Panel Recommendation. Furthermore, to ensure flexibility the Inspector insisted on cross-boundary working between Bristol City and neighbouring authorities should the need for urban extensions be required.
1.7 The arguments underpinning the above headline statements are explored
in more detail below.
2 SWRSS HOUSING TARGET
2.1 The extant RSS (RPG10), sought to deliver an average of 20,200
dwellings per annum (dpa) for the region. When undertaking a review of
existing housing targets in order to inform the emerging South West
Regional Spatial Strategy (SWRSS), the South West Regional
Development Agency, established a ‘technical requirement’ of 25,000 dpa
for the region based upon population and economic projections, details of
which are provided below.
2.2 Household projections produced by the Chelmer model and applied to the
migration assumptions used in the ONS 2003 based sub national
population projections indicated that the longer term trend rate of
household formation, augmented by continued migration would require
approximately 23,000 dpa.
2.3 These population forecasts were combined with economic projections
undertaken by Cambridge Econometrics Ltd, who made projections for
anticipated Gross Value Added (GVA) over the plan period. Whilst the
South West Regional Economic Strategy (2006 - 2015) utilised more
bullish targets for growth of 3.2% GVA per annum (an approach deemed
acceptable due to the short time horizon of the RES), a more conservative
approach was taken for the longer planning period of the SWRSS, which
based predictions against a ‘business as usual’ scenario of 2.8% GVA
growth per annum.
2.4 Whilst in the current economic climate an economic forecast of 2.8% GVA
per annum may appear optimistic, it is interesting to note that the
projection yielded an additional housing requirement of just 2,000 dpa.
This minimal increase resulted in a revised technical requirement of 25,000
dpa for the region.
2.5 This technical requirement of 25,000 dpa was put forward to the Section
4(4) Local Authorities (County Councils, Unitary Councils and National
Park Authorities) as a ‘top down’ interpretation of predicted housing need,
with the various authorities being requested to consider delivery having
regard to the central strategy of the draft RSS, their local vision for the
area, knowledge of detailed local conditions and cross boundary issues
relating to Housing Market Areas.
2.6 The result of this assessment undertaken by the various strategic
authorities was a ‘bottom up’ housing target of approximately 23,000 dpa
for the region which was incorporated into the draft SWRSS as the housing
target for the plan period.
2.7 After the draft SWRSS was approved for submission to the Secretary of
State in March 2006, the Department for Communities and Local
Government issued a revised set of sub national household projections.
Whilst these retained the 2003 ONS population projections as their basis
(23,000), they also used a significantly revised set of projections of
households likely to be produced by that population, which identified
increased levels of in-migration to rural areas and also an increase in one-
person households. To accommodate these new projections the original
Chelmer model projection of 23,000 dpa was increased by 5,000 units
annually.
2.8 During the Examination in Public (EiP), the revised population projection of
28,000 dpa was deemed acceptable on the basis that it utilised the same
population projections as the earlier Chelmer Model. However, when
considered in conjunction with the earlier GVA forecast of 2,000 additional
dpa (identified by Cambridge Econometrics Ltd), the Panel concluded that
a revised technical forecast of 30,000 dpa would be equivalent to a growth
rate associated with 3.2% GVA growth per annum, which was considered
to be in excess of past trends. Having regard to these issues, the Panel
advised that the housing target should be revised down to 28,000 dpa and
this became the established technical requirement for the region.
2.9 Whilst the Panel Report concluded that housing targets based upon an
equivalent economic prediction of 3.2% GVA growth per annum would be
too ambitious, the Secretary of State differed in her approach, instead
opting for the higher growth rate of 3.2% GVA per annum as sought by the
RES. To this extent the housing targets were again revised, this time to a
final figure of 29,623 dpa.
2.10 At all stages of the housing target review, the principal driver for
deriving housing numbers has been population change. This has
primarily been a result of decreasing household size and increasing
rates of in-migration, along with natural population increase. Whilst
the recent economic downturn and prolonged recovery will have
impacts on the 2,000 dpa aspect of the technical requirement, there is
still a latent population and household structure based need for new
housing. This can be seen in recent ONS projections that continue to
demonstrate increasing housing pressures (see Appendix 1).
3 LOCATION OF DEVELOPMENT
3.1 When identifying locations to accommodate new development, both
RPG10 and the SWRSS have maintained a functional approach to
planning. In doing so the regional strategies ascertained ‘functional areas’
which consisted of cross boundary locations which exhibited some form of
functional linkage or relationship.
3.2 For housing purposes, the functional areas were termed ‘Housing Market
Areas’ (HMAs) and numbered thirteen in total. North Somerset, formed
part of the West of England HMA, along with the settlements of Bristol,
Bath, and neighbouring smaller towns and villages.
3.3 The West of England HMA, with Bristol at its core, forms a ‘city region’,
with Bristol being the key driver of the regional economy, whose influence
extends over a wide area. RPG10 defined this city region as
encompassing, ‘…the city of Bristol and the contiguous urban area
extending into North Somerset, South Gloucestershire and BANES, [and]
is the largest urban centre in the region’ (RPG10 para 3.21).
3.4 This application of a functional approach to the growth of the sub region is
also applied with respect to economic development. The Local Enterprise
Partnership recognises the needs of the West of England as a functional
market area which closely mirrors the spatial extent of the HMA.
3.5 Weston-super-Mare is heavily influenced by its proximity to Bristol which
has resulted in significant commuting flows between the settlements. In
addition, there are numerous smaller towns and villages located on the
edge of the city which historically have accommodated development and
as a result of this growth have now formed strong commuting relationships
with Bristol (Long Ashton is a prime example). This hierarchy of inter-
dependent settlements is typical of city regions.
3.6 Due to its regional significance, the extant RPG10 and the draft SWRSS
recognised that Bristol should be the primary focus within the HMA for both
housing and employment delivery, with a key aim being to achieve a better
balance between jobs and homes within the city. Growth at Bristol would
then be supplemented with additional development focused at the
remaining SSCTs, with the extent being commensurate with the strategic
objectives for each SSCT and its functional relationship with Bristol.
3.7 When identifying the growth scenarios for the various major settlements,
the regional strategy was guided by the functional composition and
requirements of the HMA, in particular the Bristol area, and not its
constituent elements in isolation. Therefore the SWRSS allocated
development to authorities according to their ability to accommodate
growth, not in relation to their individual growth requirements. As would be
expected, due to the geographical extent of North Somerset, and its close
proximity to Bristol, it was allocated a significant share of housing as
detailed in Table 1 below:
RSS STAGE Draft
RSS (plan
period)
EiP Panel (plan
period)
SoS Changes
(plan period)
Core Strategy Provision
(plan period)
W of E HMA 110,200 126,940 137,960 BANES 15,500 18,800 21,300 Bristol City 28,000 30,000 36,500 30,600 North Somerset 26,000 26,750 26,750 14,000 South Glos 23,000 30,800 32,800 West Wiltshire 10,500 12,300 12,300 Mendip 7,200 8,300 8,300
Table 1: SWRSS breakdown of housing allocations including Bristol and North Somerset Core Strategy allocations. Due to the geographical location of North Somerset it is able to contribute to Bristol’s growth requirements of Bristol, and was allocated a significant share of housing, along with South Gloucestershire. It is interesting to note that the final housing allocation for Bristol is largely the same as the EiP Panel recommendation.
4 QUANTUM OF DEVELOPMENT
4.1 Despite the historic (and continued) trend for housing based upon
population need, the Council’s locally derived housing requirement yields a
considerably lower housing target than that set by the RSS.
4.2 Economic projections published in June 2010 by Oxford Economics (OE)
have been used by the Council to structure a case for employment led
housing delivery. In order to relate job growth to housing delivery, the
Council have used a multiplier of 1.33 new houses for every new job
created which was derived from an analysis of West of England pre-
recession trends of employment and housing growth trajectories (the
methodology is outlined in Council document ED/15).
4.3 By using this multiplier, the Council have identified the demand for 14,000
new homes, based upon the delivery of circa 10,100 new jobs over the
plan period.
4.4 The use of the 1.33 multiplier is flawed for two fundamental reasons.
Firstly, the West of England as a whole is considered a poor proxy
indicator for undertaking analysis of the relationship between housing and
employment in North Somerset. North Somerset has a very different age
profile when compared to the rest of the West of England which leads to a
different pattern of population change over the plan period.
4.5 Secondly, the Council has assumed that the multiplier would remain
constant as levels of employment change within the district. This is
unrealistic; the relationship is dynamic such that if job levels fell, the
multiplier would, in fact, rise. Housing numbers are driven by several
factors, such as economic migration, natural population changes and
changes in household structure, all of which represent significant drivers of
housing demand.
4.6 Modelling undertaken by Hardisty Jones Associates (HJA) demonstrates
that there is significant latent demand for new homes which would need to
be delivered before providing for employment growth. The HJA model
identifies a hypothetical ‘do nothing scenario’ in which further job creation
during the plan period remains at zero.
4.7 In this scenario, as a result of continued population growth with no job
creation, a total of 48,200 economic migrants (including their dependents)
would either leave North Somerset or fail to move to into the district during
the plan period. If these economic migrants are then subtracted from the
2008 population projections, an indication of the number of new houses
required to maintain current labour supplies along with anticipated
population projections for the plan period can be derived. According to the
model, this minimum baseline housing requirement for population growth,
before employment drivers are considered, totals 14,100 units (equating to
a homes to job ratio of 25.7 over the plan period).
4.8 It should be noted that the baseline is treated as a minimum, on the basis
that in reality, not all unemployed individuals would leave North Somerset.
Furthermore, latest ONS data (2010) suggests that the trend of decreased
household size is set to continue, so will undoubtedly increase the 14,100
baseline.
4.9 On this basis, the Council’s figure of 14,000 houses, which they claim is an
employment led approach to housing delivery, would in effect only address
latent population pressures. Therefore, if the Council is to satisfy its own
employment target of an additional 10,100 jobs during the plan period, the
HJA model projects that a further supply of 8,100 new houses would be
required to accommodate additional job growth (equating to a home to job
ratio of 2.2).
4.10 With respect to the identification of economic growth requirements, the
Draft National Planning Policy Framework (DNPPF) clarifies that, ‘Local
planning authorities should have a clear understanding of business needs
within the economic markets operating in and across their area. To achieve
this, they should:
• Work together with county and neighbouring authorities and with local
enterprise partnerships to prepare and maintain a robust evidence
base to understand both existing business needs and likely changes in
the market;’ (DNPPF, para 29).
4.11 The boundary of the Local Enterprise Partnership acknowledges that the
West of England is a functional economic market area, whose spatial
extent mirrors that of the West of England HMA. The LEP board
recognises that the West of England is one of the fastest growing
economies in the UK and one with a proven history of resilience to global
economic change. On this basis the LEP, amongst other objectives, seeks
to deliver 95,000 new jobs by 2030. On a pro rated basis this 95,000 job
target would equate to the delivery of 11,400 jobs in North Somerset
during the plan period.
4.12 Using the HJA modelling, in addition to the latent population
requirement of 14,100 houses, the LEP target would necessitate the
delivery of an additional 9,100 houses to satisfy LEP employment
growth objectives (23,200 houses during the plan period at a home to
job ratio of 2.0).
4.13 A more detailed account of the HJA modelling methodology is at Appendix 2.
5 ROBUSTNESS OF SWRSS EVIDENCE BASE
5.1 As already highlighted, the SWRSS housing figures were derived
principally from latent population demand identified by the Chelmer model
of population projections. These population based targets were then
increased at the various RSS stages having regard to economic growth
projections of 2.8% GVA per annum and then subsequently by 3.2% per
annum by the Secretary of State’s amendments.
5.2 The country is still in the process of prolonged recovery from what has
been the worst global recession in modern times. In this respect the
economic based amendments to the SWRSS housing figures may have
been too bullish. Therefore, if regard is had purely to the 2003 population
projections that underpin the SWRSS housing targets i.e. before the
subsequent economic led projection increases, with respect to North
Somerset’s proportion of delivery for the HMA this would have
necessitated 24,799 houses over the plan period (Appendix A (ii) EiP
Panel Report). It should be evident that this figure sits comfortably with the
housing targets modelled by HJA, and summarised in the table below:
Latent
Population Demand Only
Latent Demand Plus Core Strategy Growth
Latent Demand Plus LEP Growth
SWRSS 2003 Population Projection
SWRSS Panel Requirement
Housing No.
14,100 22,100 23,200 24,799 26,750
Table 2: HJA modelling scenarios and SWRSS 2003 population projections. The HJA model for Core Strategy and LEP growth sit comfortably with the SWRSS population projections.
5.3 Both the SWRSS evidence base and the modelling undertaken by HJA
demonstrate that there is a significant population driven demand for new
housing which needs to be accommodated within North Somerset as part
of the ongoing economic growth of the West of England. In testing a
hypothetical situation, a scenario run through the HJA model assumes that
all unemployed economic migrants would leave North Somerset and move
elsewhere within the HMA. Such an exodus is unlikely, and when coupled
with the anticipated decreases in household size is highly likely to increase
the level of latent population demand for housing within the district, thus
closing the gap, or indeed increasing the housing requirement beyond the
SWRSS 2003 population target. If this latter scenario occurs (as is
expected), then the SWRSS Panel requirement of 26,750 units appears
robust.
6 CROSS BOUNDARY IMPLICATIONS FOR REDUCED HOUSING PROVISION
6.1 Bristol City Council’s Core Strategy has recently been subject to EiP and
has now been adopted. In respect of housing numbers, the Council sought
to deliver a minimum of 26,400 units over the plan period. When
considering this, the Inspector placed weight on the 2003 population
projections, stating that ‘they [the projections] strongly suggest that
household growth pressures may well be greater and potentially much
greater than the Council is planning for’ (Bristol City Council Core Strategy
DPD Inspector’s Report, para. 18). However, the Inspector also recognised
that there would be inevitable uncertainty about the assumptions
embedded in the projections and therefore insisted that some flexibility be
incorporated to satisfy growth beyond that predicted by the 2003 ONS
projections should this be necessary (i.e. growth more in line with the
Secretary of State’s modifications).
6.2 On this basis, the Inspector required that the Council align housing
provision with the SWRSS Panel recommendations of 30,000 units for the
plan period, therefore ensuring that the 2003 projections would be
satisfied. The Inspector ensured flexibility in the plan by requiring the
Council to review development pressures after a five year period, and if
necessary releasing land from the Green Belt at south east Bristol to
accommodate further housing delivery.
6.3 This flexibility and the need for contingency land was taken further by the
Inspector in his requirement for Bristol to undertake cross boundary
working with other neighbouring authorities should they be required to
deliver urban extensions, as ‘…the Green Belt could also have a role in
providing sizeable urban extensions on a cross-boundary basis, as was
proposed by the Secretary of State in the emerging RSS. A cross-
boundary approach would ensure that the size and form of any urban
extension(s) was properly planned to maximise sustainability, rather than
being determined by the rather irregular shape of Bristol City’s
administrative boundary’ (Bristol City Council Core Strategy DPD
Inspector’s Report, para. 44).
6.4 The Inspectors requirement for cross boundary working is in
recognition of the fact that housing delivery is to accommodate the
needs of the wider HMA and not just the needs of the component
authorities in isolation. The development requirements of Bristol as a
city region will inevitably spill over to other authorities which are part
of that city region due to the City of Bristol’s constrained
administrative boundary, thus the need for a joined-up approach to
accommodating new development.
6.5 Despite the well established approach of planning for the wider HMA, the
Council is failing to maintain this holistic approach. In their pre-examination
response to the Inspector (ED/03), the Council maintain that the Core
Strategy remains in general conformity with both extant RSS (RPG10) and
the draft SWRSS (aside from the quantum of development being brought
forward). The Council’s rationale for general conformity is that the Core
Strategy maintains a hierarchical approach to development, focusing
employment led regeneration at Weston-super-Mare, followed by smaller
scale development at larger towns and settlements. What the Core
Strategy does not take account of is the needs of the wider HMA in
particular Bristol.
6.6 As already highlighted, there is a need for significant growth in the housing
stock if North Somerset is to satisfy latent housing demand of 14,100 units
and contribute to its own employment growth aspirations set out in the draft
LDF Core Strategy or the higher level implied by the LEP targets.
6.7 Without increasing housing delivery, potential economic growth in
both North Somerset and the West of England will be constrained,
resulting in a potential decline in the competitiveness of the West of
England if businesses (both existing and new inward investors) are
not able to grow their workforce in the sub-region. Furthermore, the
failure to provide sufficient housing is likely to increase levels of in-
commuting by those individuals required to work in Bristol but who
are forced to live further afield, resulting in obvious environmental
and sustainability impacts, which are contrary to the sustainability
aspirations of both North Somerset and the other West of England
authorities.
7 CONCLUSIONS
7.1 The Council has failed to plan for the needs of the wider HMA and has
sought to structure a case for the development requirements of North
Somerset in isolation. In doing so it has failed to appreciate the role that
settlements within the HMA and Bristol play.
7.2 The Council’s failure to adopt a collaborative approach with adjoining
authorities and to deliver a balanced provision of additional housing
requirements has resulted in a woefully inadequate housing target. The
methodology adopted by the Council in reaching their housing target and,
therefore, the justification for the housing evidence is inherently flawed.
7.3 The Council has used an economic base that pays insufficient attention to
latent population demand. It makes no inroads whatsoever into delivering
housing to enable either the Core Strategy or LEP employment targets.
The Council has maintained this approach despite the Core Strategy
requirement of Bristol to deliver draft SWRSS (Panel recommendation)
levels of housing growth.
7.4 Should North Somerset fail to provide a level of development
commensurate with the needs of the HMA, the social and economic
ramifications over the plan period will be severe. Potential economic
growth in both North Somerset and the West of England will be
constrained, resulting in a potential decline in competitiveness of the West
of England as an economic entity.
7.5 The evidence base and approach undertaken by the Council in reaching
their housing target of 14,000 is inherently flawed and unsound. The
modelling undertaken by HJA robustly demonstrates a requirement for
23,200 houses over the plan period.
7.6 As will be demonstrated in the University’s Position Statement concerning
the Council’s Spatial Strategy, the land it owns at Long Ashton is capable
of providing approximately 1000 new dwellings, together with new
employment and associated social and physical infrastructure. This will
help meet the increased number of housing we believe must be provided
to meet HMA requirements.
Appendix 1 – ONS Population Projections
Appendix 1 – ONS Population Projections
Appendix 2 – HJA Modelling Methodology
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1. Introduction
The purpose of this technical note is to provide detail on the modelling process used by Hardisty
Jones Associates (hereafter HJA) in assessing future housing requirements in North Somerset and
the West of England. This modelling work was undertaken on behalf of the University of Bristol to
support their submissions to the North Somerset Core Strategy Examination.
2. Principles
The Office for National Statistics produces population and household projections for the UK and its
constituent countries, regions and local authority areas. The 20081 based sub‐national projections
were the starting point for this assessment.
In response to North Somerset Council’s evidence base, the HJA modelling was designed to test
whether the approach adopted and whether it would provide sufficient housing for expected local
requirements.
The HJA model is founded on the principle that housing demand will be fuelled by various drivers:
Changes in the structure of the existing population
Natural change (births and deaths)
Economic and employment related migration
Non economic and employment related migration (e.g. other social reasons)
Changes in household structure
The approach adopted within the North Somerset evidence base suggests that all these elements
will move in unison in direct relation to the level of employment generated. HJA believe this is
flawed and fails to recognise the nature of the differing drivers. The HJA model seeks to strip out
only the effects of economic and employment related housing growth, given that the other
components are primarily driven by other factors and would be likely to take place in any event. In
theory this is a similar starting position to that adopted in the North Somerset Council evidence
base.
The HJA approach utilises a theoretical model to test the implications of varying employment
assumptions upon housing requirements. The results of the model are based upon the assumption
that economic driven net‐migration is highly responsive to changes in employment levels. In reality,
migration is likely to be less flexible than assumed, with other variables adjusting in response to
differing employment levels, in particular unemployment/economic inactivity and travel to
work/commuting patterns. The results of the HJA model are therefore the minimum level of
housing required, for any given employment level. It is our professional opinion that, in reality,
given the scale of 2008 based population projections, and the most recent 2010 based release of
revised population projections for the UK, a higher level of housing would be required for all the
employment scenarios tested.
1 2010 based population projections for the UK and its constituent countries were released on 26th October 2011 suggesting higher levels of population growth than envisaged within the 2008 based projections.
The work by HJA has not considered matters surrounding latent demand, housing need or
affordability, all of which may contribute to higher levels of future requirements.
The HJA model is constructed in three parts:
1. Labour supply
2. Labour demand
3. Matching and Housing
3. Labour Supply
The labour supply component considers 2008 based population projections by age group. Economic
activity assumptions are then applied to each age group over time. The economic activity
assumptions are in line with ONS assumptions2 on labour market participation, rebased to local
patterns of activity. In broad terms these assumptions are as follows:
Little change in participation of 16‐24 year olds. There are competing factors for this age cohort.
Little change in participation of 25‐49 year olds.
Significant growth in the participation of 50‐64 year olds – as retirement ages increase and
pension shortfalls require working later in life.
Modest increases in participation rates of 65+ age group – whilst retirement ages will rise, the
large scale rises in population of this group are in much older age categories.
Table 1: Economic Activity Assumptions by Age Group in 2006 and 2026
Age Group Economic Activity Rate
2006 2026
16‐24 73.6% 77.4%
25‐49 89.2% 89.0%
50‐64 69.9% 79.7%
65+ 7.0% 9.5%
Source: HJA based on ONS
After applying these assumptions an estimate of economically active population is derived. An
assumption for unemployment is then applied. Within the HJA model this is a fixed assumption
based on an average of 2004‐2010 data taken from the Annual Population Survey. At 3.4% this is a
realistic long term assumption for North Somerset over the long term.
Applying the unemployment assumption provides an estimate of the potential employed workforce
to maintain a healthy labour market in line with population projections.
Table 2: Potential Resident Based Employed Workforce in 2006 and 2026
2006 2026 Change 2006‐26
North Somerset 101,400 134,200 32,800
Source: HJA (all figures rounded to nearest 100 so may not sum)
2 UK Labour Force Projections, 2006‐20, Vassilis Madouros,
4. Labour Demand
Three alternative employment (labour demand) scenarios have been shaped.
Zero growth beyond already published data
o An estimated 550 additional jobs have been created in North Somerset according to the
latest available data.
LDF Core Strategy Central Scenario
o 10,100 additional jobs in North Somerset.
Pro Rated LEP target growth
o 11,400 additional jobs in North Somerset 2006‐26 based on the UA area’s share of West
of England employment and linear growth over the period 2010‐2030.
An allowance is made for double jobbing (i.e. those persons who occupy two jobs) based on data on
employment and employee numbers within the Business Register and Employment Survey (BRES). A
further adjustment is made for net commuting patterns. Varying scenarios relating to net
commuting can be tested. The core model assumes net commuting patterns remain constant in
relative terms. Other scenarios could include holding absolute levels of commuting constant, or
adopting a target for adjusting net commuting. However, there is no clearly identified policy lever to
adjust levels of net commuting at this time. Levels of housing development will not of themselves
lead to any adjustment. Based on the current level of employment growth within the North
Somerset Core Strategy and the ascribed targets of the LEP it is likely that North Somerset will under
provide in employment terms in which case there could be increased pressure for greater out
commuting.
The outcome of this modelling component is an estimate of the required employed population to
meet the employment scenarios.
Table 3: Potential Resident Based Employment in 2006 and 2026
Scenario 2006 2026 Change 2006‐263
Nil further employment growth 103,100 103,800 700
Core Strategy aligned 103,100 115,500 12,400
LEP pro rated growth 103,100 117,100 13,900
Source: HJA (all figures rounded to nearest 100 so may not sum)
N.b Resident based employment in 2006 is slightly higher than the estimate of available labour force. This may be as a
result of adjustments in commuting rates for which no available data is available. The focus of this exercise is to consider
the changes over the period 2006‐26 and therefore the alignment in any one year does not have a material impact on the
validity of the conclusions drawn.
5. Matching and Housing
The results of the labour supply and labour demand components are compared. Under the
scenarios tested, in all cases the level of labour demand was below labour supply. This produced a
residual workforce. As identified above, should this become reality there is the potential for
3 Due to the allowance for double jobbing and net commuting these figures do not directly relate to the Core Strategy (10,100) and Pro Rated LEP (11,400) levels of employment growth within North Somerset assumed in the modelling.
adjustment to either unemployment/inactivity, net commuting rates or the levels of economic led
migration. For the purposes of this analysis it is assumed that economic migration takes 100% of the
slack.
For each residual worker, it is assumed that 0.5 trailing migrants would be associated. Data from
Effects of taxes and benefits on household income, ONS, 2008/09 for non‐retired household size was
used. The number of economically active persons in the household and associated dependents was
used to determine the likely level of associated migration. Analysis excluded the bottom quintile
households by income. The following data was used to derive the adopted assumptions:
Average household size – 2.6 persons
Average economically active persons per household – 1.74 persons
Average dependents per worker – 0.5 persons
Therefore, within the model, for each surplus worker, the population is adjusted downwards by 1.5
persons. In aggregate, this leads to a downward revision of 2026 population projections, directly
related to the considered employment scenarios.
Table 4: Potential Residual Workforce and Population Reductions over the period 2006‐2026
Scenario Residual Workforce Population Adjustment
Nil further employment growth 32,100 48,200
Core Strategy aligned 20,400 30,600
LEP pro rated growth 18,800 28,200
Source: HJA (all figures rounded to nearest 100 so may not sum)
The amended population projections are then converted into housing requirements on the basis of
ONS projections for household size (2.33 in 2006 and 2.20 in 2026). The ONS data suggest a fall in
household size due in part to the ageing of the population and the breakdown of families among
other factors. Whilst the HJA model has adopted the ONS assumptions, one could quite readily
postulate that with a significant reduction in working age population as modelled, the relative
effects of the ageing population would be greater and hence household size in North Somerset may
fall more rapidly, thus further increasing housing requirements. However, this has not been tested
at this stage.
Table 5: Estimated Housing Requirements in North Somerset over the period 2006‐2026
Scenario Housing
Requirement Additional
Jobs Homes to Jobs
Ratio
Nil further employment growth 14,100 600 25.7
Core Strategy aligned 22,100 10,100 2.2
LEP pro rated growth 23,200 11,400 2.0
Source: HJA (all figures rounded to nearest 100 so may not sum)
6. Conclusions
The outputs clearly differ from the analysis presented by North Somerset Council. In particular, it
demonstrates that rather than employment and housing being directly linked through a multiplier of
1.33 (which would imply zero jobs requires zero homes) the relationship is based on both a baseline
requirement related to population (circa 14,000) plus a further 0.844 homes required for each
additional job. As a result the overall ratio of homes to jobs varies with the level of employment as
shown in table 5. For higher levels of employment the ratio reduces. The assumption adopted
within the North Somerset evidence base of 1.33 homes per job would only hold for one specific
level of employment5, rather than across an extended range.
HJA analysis for the West of England indicates that for levels of employment growth in line with the
North Somerset Core Strategy the average homes to jobs ratio is approximately 1.35, the sub‐
regional assumption adopted by North Somerset in its evidence base. However, the detailed North
Somerset modelling highlights the very different demographic structure of North Somerset, in
particular its older population profile, and hence the very different ratio of homes to jobs.
As stated previously, this entire analysis assumes migration takes the entire slack of low labour
demand. In reality this is highly unlikely, with higher unemployment, economic inactivity and net
commuting likely to manifest in reality.
4 In technical terms, the HJA estimated equation for deriving minimum housing levels is h = 0.837j+13,653 where h = homes and j = jobs. 5 The North Somerset assumption would only hold at 34,740 jobs in North Somerset.